What You Should Know About Inflation by Henry Hazlitt

Author:Henry Hazlitt [Henry Hazlitt]
Language: eng
Format: epub, pdf
ISBN: 978-1-61016-281-4
Publisher: D. Van Nostrand Company, Inc.
Published: 1965-11-06T16:00:00+00:00

24

The Great Swindle

I present in this chapter a table compiled by the First National City Bank of New York (published in its monthly economic letter of July, 1964) showing the shrinkage in purchasing power of the currencies of 42 countries over the ten-year period 1953-1963. The shrinkage is calculated inversely from the increases in cost-of-living or consumer price index as reported by governments.

It is important to keep this appalling worldwide picture constantly before our minds. It reminds us that inflation is nothing but a great swindle, and that this swindle is practiced in varying degrees, sometimes ignorantly and sometimes cynically, by nearly every government in the world. This swindle erodes the purchasing power of everybody’s income and the purchasing power of everybody’s savings. It is a concealed tax, and the most vicious of all taxes. It taxes the incomes and savings of the poor by the same percentage as the incomes and savings of the rich. It falls with greatest force precisely on the thrifty, on the aged, on those who cannot protect themselves by speculation or by demanding and getting higher money incomes to compensate for the depreciation of the monetary unit.

Why does this swindle go on? It goes on because governments wish to spend, partly for armaments and in most cases preponderantly for subsidies and handouts to various pressure groups, but lack the courage to tax as much as they spend. It goes on, in other words, because governments wish to buy the votes of some of us while concealing from the rest of us that those votes are being bought with our own money. It goes on because politicians (partly through the second- or third-hand influence of the theories of the late Lord Keynes) think that this is the way, and the only way, to maintain “full employment,” the present-day fetish of the self-styled progressives. It goes on because the international gold standard has been abandoned, because the world’s currencies are essentially paper currencies, adrift without an anchor, blown about by every political wind, and at the mercy of every bureaucratic caprice. And the very governments that are inflating profess solemnly to be “fighting” inflation. Through cheap-money policies, or the printing press, or both, they increase the supply of money and credit and affect to deplore the inevitable result.

Download

Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.